CTC Media posts $24 mln in Q4 net losses
MOSCOW. Feb 28 (Interfax) - CTC Media posted $24 million in net losses in the fourth quarter of last year versus $75.3 million in profits for the same three months a year earlier, a company statement says.
Investment bank analysts had expected CTC Media to show $61 million in net profits for the quarter, which would have been a 19% year-on-year drop.
Operating revenues were up 6% at $236.758 million and total operating expenses 96% at $238.264 million. OIBDA (operating income before depreciation and amortization) was $3.218 million and the OIBDA margin 1.5% for the quarter.
For last year as a whole, CTC Media posted total operating revenues of $766.360 million (up 27%), total operating expenses of $643.675 million (up 63%), OIBDA of $140.334 million (down 36%), and an OIBDA margin of 18.3%. Advertising time inventory was almost totally sold out for both Q4 and the year.
"Advertising budget volumes exceeded pre-crisis levels for the first time in 2011. Our advertising prices increased more than the market due to the attractive profile of the target audiences that our channels deliver. The growth of the TV advertising market did slow down during the second half of the year, which partly reflected the high comps in 2010, while our revenue growth levels were impacted by lower year-on-year audience shares for our flagship CTC channel. The year-on-year growth in our operating costs reflected the investments that we have made in programming, regional stations, and our new media projects, and our absolute profitability was also impacted by a number of non-cash impairment charges," acting CEO and CFO Boris Podolsky said, as quoted in the statement.
"Russian advertising sales accounted for approximately 95% of total operating revenues during both the fourth quarter and full year of 2011, with sales down 1% and up 12% year-on-year in ruble terms on a comparable basis for the quarter and the full year, respectively. Russian national advertising inventory was almost fully sold-out in the fourth quarter and for the full year," the statement says. Advertising revenue was up 13% year-on-year at $229.969 million for the quarter.
"We have made a solid start to 2012, with all of our Russian channels increasing their target audience shares compared to the average Q4 levels. Locally produced prime time shows such as 'Doctor Zaytseva's Diary' and 'The 80s' have performed very well, especially in the commercially attractive 14-44 demographic, and reflect our focus on high quality and tailor-made content. We will launch new seasons of hit show 'Boarding School' and a reworked version of 'Daddy's Daughters' during 2012, as well as a wide range of new formats including original content produced by our Story First in-house production unit," Podolsky said.
CTC rebranded DTV Network to Peretz in October, making significant programming and positioning changes. "The DTV channel has been rebranded and repositioned as Peretz and the network's ratings have shown early signs of improvement among the revised target audience," Podolsky said.
CTC Media had a net cash position of $112.6 million at the end of the reporting period.
Technical penetration of the CTC, Domashny, and Peretz networks increased to a respective 94.7% (93.7% in 2010), 84.9% (81.6%), and 80.1% (72.5%). CTC Media acquired 14 regional television stations in twelve Russian towns last year, mainly to increase the availability of the Domashny and Peretz networks, the statement says.
"CTC Media's content now available on iPhone, iPad, Android platform devices, LG Smart TV, D-link's Boxee digital media player, VimpelCom's IPTV platform Beeline TV, and Facebook and Vkontakte social networks," the statement says.
"The CTC Network maintained its place as the fourth most-watched broadcaster in Russia in 2011, while its average target audience share was down year-on-year, reflecting intensified competition and audience fragmentation as well as underperformance of certain programming in 2011. All larger national free-to-air TV channels in Russia were negatively impacted by increased non-free-to-air and local TV channel viewership, which was up year-on-year for the full year 2011 from 13.8% to 16.2% among 6 to 54 year-olds," the statement says.
